There has been debate among statisticians and political scientists about using differential privacy for census data. 2020 was actually the first Decennial Census that used differential privacy. This is the mandated census done every 10 years that counts population and is used for apportionment. Some have criticized the use of differential privacy.[1][2] But others have argued that coarsening does not protect privacy sufficiently and that differential privacy does not distort apportionment.

The political context is unclear. There are lawsuits about whether differential privacy is constitutional. There is also the possibility that citizenship status can be inferred by using multiple census products put together. It's also possible redistricting is at stake although it's unclear to me how getting rid of differential privacy benefits any one party.

[1]: https://apnews.com/article/business-census-2020-technology-e...

[2]: https://www.science.org/doi/10.1126/sciadv.abk3283